Setting the Stage: Aviation’s Carbon Challenge

International aviation accounts for roughly 2–3% of global carbon dioxide (CO2) emissions, a share that has been growing steadily as air travel becomes more accessible. Unlike many ground-based industries, aviation lacks ready alternatives to fossil fuels for long-haul flights, making emission reductions particularly difficult. In response, the International Civil Aviation Organization (ICAO) developed the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)—the world’s first global market-based measure aimed at capping and then reducing the sector’s net CO2 emissions. This article examines CORSIA’s structure, its importance, the challenges it faces, and the opportunities it creates for a more sustainable future in aviation.

Understanding CORSIA: How the Scheme Works

CORSIA was adopted by ICAO’s 193 member states in 2016 and formally launched in 2021. It is designed to offset the growth of CO2 emissions from international flights (domestic flights are excluded) above a baseline level. The baseline is set at 2019 and 2020 average emissions. Under the scheme, airlines must purchase carbon credits—typically from certified projects that reduce or remove emissions elsewhere—to compensate for any emissions exceeding that baseline.

Phased Implementation

CORSIA is implemented in three phases:

  • Pilot Phase (2021–2023): Voluntary participation by states, with around 115 countries taking part. This phase allows airlines and regulators to test the system and build infrastructure.
  • First Phase (2024–2026): Still voluntary for most countries, but the baseline is adjusted (using 2019 emissions only) to raise ambition. From 2024, the baseline is fixed at 85% of 2019 emissions, meaning that any growth beyond that level must be offset.
  • Second Phase (2027–2035): Mandatory for all states that have a share of international aviation revenue tonne kilometres (RTKs) above a certain threshold, with exemptions for small emitters. The baseline becomes 85% of 2019 emissions for the entire period.

The scheme covers CO2 emissions only, not other greenhouse gases or non-CO2 effects such as contrails. Offsetting is done by purchasing emission units from approved programmes—such as the Clean Development Mechanism (CDM), the Verified Carbon Standard (VCS), or the Gold Standard—that meet ICAO’s environmental integrity criteria.

Eligible Fuels and Emissions Reduction

In addition to offsetting, CORSIA encourages the use of sustainable aviation fuels (SAFs) that reduce lifecycle emissions compared to conventional jet fuel. Airlines can reduce their offsetting obligation by using certified SAFs, which can cut CO2 emissions by up to 80% depending on the feedstock and production method. The scheme also includes a mechanism to account for emissions from aircraft operations based on fuel burn, with reporting requirements for airlines on all international flights.

The Significance of CORSIA: Why It Matters

CORSIA is a landmark agreement for several reasons. It represents the first time the aviation industry, governments, and environmental bodies have agreed on a global framework to tackle emissions. Its significance can be understood through three lenses: environmental impact, economic incentives, and global cooperation.

Environmental Impact

Without CORSIA, international aviation emissions were projected to increase by 150–300% by 2050 compared to 2019 levels. By capping net emissions at 85% of 2019 levels for the duration of the scheme, CORSIA is expected to offset around 2.5 billion tonnes of CO2 between 2021 and 2035. This represents a meaningful contribution to the Paris Agreement goals, even though aviation is not explicitly covered by national climate targets. The scheme also provides a financial incentive for airlines to invest in efficiency measures, such as lighter materials, more aerodynamic designs, and optimised flight routes.

Economic Incentives and Carbon Markets

By requiring airlines to purchase carbon credits, CORSIA creates a new demand for high-quality offsets. This, in turn, channels billions of dollars into projects that protect forests, restore peatlands, deploy renewable energy, and improve cookstoves in developing countries. The scheme also encourages innovation in SAF production, as airlines can reduce their offset liability by adopting lower-carbon fuels. For example, a recent study by the International Air Transport Association (IATA) estimated that SAF could supply 2% of global jet fuel demand by 2025 and up to 50% by 2050, with CORSIA acting as a catalyst. IATA provides further details on CORSIA’s implications for airlines.

Global Cooperation and Level Playing Field

Before CORSIA, the aviation industry faced a patchwork of national and regional carbon pricing schemes—for instance, the European Union’s Emissions Trading System (EU ETS) for intra-European flights—which could create competitive distortions. CORSIA offers a single, global approach that applies uniformly to all airlines on routes between participating states. This reduces the risk of carbon leakage (where airlines shift routes to avoid regulation) and ensures that all carriers share the cost of environmental responsibility. Over 115 states representing more than 80% of international aviation RTKs voluntarily joined the pilot phase, demonstrating broad commitment.

Challenges in Implementation

Despite its promise, CORSIA faces several significant hurdles that could limit its effectiveness if not addressed.

Baseline Calculation and Ambition

The original baseline (2019–2020 average) was chosen before the COVID-19 pandemic caused a dramatic drop in flying. As a result, the baseline is relatively high compared to actual 2021–2023 emissions. This means airlines may not need to buy many offsets in the early years, reducing the immediate climate benefit. Critics argue that the baseline should be revised downward to reflect the lower emissions trajectory. ICAO has acknowledged this issue and adjusted the baseline for the first and second phases to a fixed 85% of 2019 emissions, but the debate continues over whether this is ambitious enough to align with a 1.5°C pathway.

Offset Quality and Double Counting

Not all carbon credits are created equal. There have been widely reported concerns about the environmental integrity of some offset projects—for example, forestry projects that overestimate carbon storage or renewable energy projects that would have happened anyway. CORSIA relies on strict eligibility criteria, but ensuring that every tonne of CO2 claimed is truly additional and permanent remains a challenge. Additionally, double counting can occur if a host country counts the same emission reduction under its own national climate pledge (Nationally Determined Contribution under the Paris Agreement). ICAO has addressed this through “corresponding adjustments” under Article 6 of the Paris Agreement, but implementation is complex. The official ICAO CORSIA page provides detailed documentation on eligibility criteria.

Transparency and Enforcement

Airlines must report their emissions annually, and independent third-party verification is required. However, the cost of compliance can be significant for smaller carriers, and there is no global enforcement body with the power to fine or sanction non-compliant states or airlines. ICAO relies on reporting to its council and voluntary compliance mechanisms. Some environmental groups have called for stronger oversight and public disclosure of offset purchases.

Exemptions and Coverage Gaps

Small island developing states, least developed countries, and states with low aviation activity are exempt from participation in the mandatory phase. While this ensures fairness, it also means that a small but growing share of emissions is not covered. Furthermore, non-CO2 climate effects—such as nitrogen oxides (NOx), water vapour, soot, and contrail cirrus—are not addressed by CORSIA, even though they may equal or exceed the warming impact of CO2 alone.

Opportunities for Innovation and Leadership

Despite its challenges, CORSIA opens the door to significant innovation across the aviation value chain.

Accelerating Sustainable Aviation Fuels

The strongest opportunity lies in the development and scaling of sustainable aviation fuels (SAFs). CORSIA’s lifecycle emission methodology allows SAFs to reduce an airline’s offsetting requirement. As a result, airlines are now entering offtake agreements with producers, and governments are providing subsidies (e.g., the US Inflation Reduction Act’s SAF tax credit). According to the International Energy Agency, SAF production could reach 5–10 million tonnes per year by 2030 with policy support. The IEA’s aviation tracking report highlights the role of SAF in meeting CORSIA goals.

Carbon Market Development

CORSIA is also driving investment in carbon credit projects, particularly in developing countries. Projects that protect forests (REDD+), restore mangroves, and deploy renewable energy have seen increased funding, partly in anticipation of demand from airlines. This flow of finance can support the Sustainable Development Goals, including poverty reduction, clean energy access, and biodiversity conservation. However, ensuring that these projects meet high integrity standards is essential to prevent greenwashing.

Technological Advances in Aircraft

While offsetting buys time, the long-term solution remains technology. CORSIA’s cost pressure has spurred research into hydrogen-powered aircraft, electric propulsion for short-haul flights, and more efficient aerodynamic designs. Airlines and manufacturers are investing heavily, and the first generation of hybrid-electric regional aircraft could enter service by the mid-2030s. CORSIA ensures that the sector does not delay these investments by relying solely on offsets.

CORSIA’s Role in the Long-Term Climate Strategy for Aviation

In 2022, ICAO’s 41st Assembly adopted a long-term global aspirational goal (LTAG) for international aviation to achieve net-zero CO2 emissions by 2050. CORSIA is a critical bridging mechanism to this target. For the period 2021–2035, it caps net emissions; after 2035, additional measures—such as widespread SAF use, carbon removal technologies, and possibly a tightened offsetting scheme—will be needed to reach net-zero.

The relationship between CORSIA and the LTAG is complementary. CORSIA provides a market-based framework that drives early action, while the LTAG provides a clear direction for the industry. However, many analysts argue that CORSIA’s current ambition level is insufficient to meet the net-zero goal, and that the second phase baseline should be strengthened. Some states have already signalled their intent to adopt tighter domestic measures, such as the EU’s “Fit for 55” package, which will gradually phase out free allowances for aviation under the EU ETS by 2027.

“CORSIA is not the final answer—it is an essential stepping stone. Without it, the aviation industry would have no coherent global framework to begin decarbonisation. With it, we have a foundation to build on.” — From an ICAO policy brief on sustainable aviation.

In addition, CORSIA’s experience with reporting, verification, and carbon credit integrity is informing the design of future carbon pricing mechanisms in other sectors. The scheme’s technical standards for emissions monitoring are becoming a global norm, and its pilot phase helped identify operational challenges that are now being addressed.

Conclusion: A Necessary Bridge, but Only the Beginning

CORSIA represents a historic achievement in international climate cooperation—the first sectoral, global market-based measure to cap emissions from a growing industry. It has already prompted airlines to measure and report their emissions more accurately, stimulated investment in sustainable fuels and offset projects, and created a level playing field for competitors around the world. Its environmental impact, while not sufficient on its own, buys precious time for technology to mature and for governments to adopt stronger policies.

Yet the scheme is not without flaws. The baseline may be too generous, offset quality must be vigilantly maintained, and non-CO2 effects remain unaddressed. For CORSIA to fulfill its promise, ICAO and its member states must continuously strengthen the rules—tightening the baseline, expanding coverage to more emissions sources, and ensuring that carbon credits represent real, additional, and permanent reductions. Airlines, too, must go beyond compliance, embracing decarbonisation not as a cost to be minimised but as a strategic opportunity.

As air travel continues to rebound and grow, especially in Asia and Africa, the urgency of aviation decarbonisation cannot be overstated. CORSIA is not a silver bullet; it is a vital first step. Its success will depend on the collective will of governments, the aviation industry, and civil society to hold each other accountable and to accelerate the transition to a net-zero future. The European Commission’s page on aviation emissions highlights complementary regional policies that may push CORSIA to greater ambition.

Ultimately, the significance of ICAO’s Carbon Offsetting and Reduction Scheme lies not just in the tonnes of CO2 it offsets, but in the precedent it sets: a global industry taking responsibility for its climate impact, and in doing so, showing that even the most challenging sectors can begin the journey toward sustainability.